The FDA has opened a probe into smoking cessation claims first revealed in a TINA.org investigation of questionable and misleading e-cigarette marketing.

TINA.org’s investigation published in September found that close to one-third of 150 e-cigarette websites reviewed made some kind of smoking cessation claim. These claims were made in a variety of ways, either through testimonials, anecdotes and marketing statements or a combination. The claims were captured in a database published as part of TINA.org’s investigation.

The FDA’s action comes after five health advocacy organizations urged the agency to take prompt action based on TINA.org’s findings. In a Nov. 17 letter to the organizations — which includes the American Cancer Society, American Heart Association, American Lung Association, Truth Initiative and the Campaign for Tobacco-Free Kids — the FDA said it has initiated a review of the marketing claims on the websites noted in TINA.org’s database and upon completion “we intend to take regulatory action as appropriate.”

To date, no e-cigarette product is approved by the FDA for use as a smoking cessation aid. Despite this fact, TINA.org identified 50 sites that were making smoking cessation claims.

The health groups in their letter to the FDA urging action said that the evidence uncovered by TINA.org “suggests that violations of federal law on a massive scale are taking place in the marketing of e-cigarettes.”

Janet Woodcock, director for the FDA’s Center for Drug Evaluation and Research, responded that the agency shared the group’s concern about the proliferation of claims. Woodcock wrote:

The marketing of e-cigarettes for smoking cessation is an issue of great concern to the Agency. Cigarette smoking is estimated to cause more than 480,000 deaths annually, so helping people quit smoking is a top health priority. To maximize their chances of a successful quit attempt, it is important that smokers use a product that has been approved by the FDA as safe and effective for use as a smoking cessation aid.

There is evidence that vaping products do not help people quit tobacco cigarettes. A recent study conducted by researchers at the University of California San Diego School of Medicine and published in the American Journal of Public Health found that smokers who used e-cigarettes were 49 percent less likely to decrease cigarette use and 59 percent less likely to quit smoking compared to smokers who never used e-cigarettes.

It’s been more than a year since the FDA signaled it was going to regulate the e-cigarette industry but the final rules have not yet been released. In the meantime, many online e-cigarette companies are taking advantage of the regulatory gaps and making a variety of claims including that e-cigarettes are safe, and/or a healthier alternative to traditional cigarettes. TINA.org’s review found that at least 50 percent of the sites reviewed mentioned health benefits, despite the fact that the FDA currently maintains that the risks associated with e-cigarettes have not been fully studied and some key reports have found harmful chemicals and health effects.

In addition to the smoking cessation and health claims, TINA.org’s review also found that one-third of sites made the misleading claim that e-cigarette could be smoked anywhere or virtually anywhere and that 44 percent claimed they were cheaper than tobacco cigarettes.

Himachal Fibres manufactures cotton and synthetic blended yarn. The business, however, seems to be going through a tough time. The textiles manufacturer reported a decline in sales in four of the past five quarters up to September 2015. Total sales were Rs82.24 crore for the year ended September 2015, down 13.27% compared to those in same period a year ago. The company reported a total net loss of Rs1.12 crore and Rs0.60 crore for the year ended September 2015 and September 2014, respectively. Despite its poor financials, the stock price shot up a remarkable 3318%, or 34 times, to Rs45.80 on 20 November 2015, from Rs1.34 on 19 September 2014. Had you invested Rs10,000 in this stock, in just over a year, your investment would be worth about Rs3 lakh. In February 2015, the stock was split from Rs10 to Rs1. In November 2007, Himachal Fibres was suspended for not complying with the listing agreement. With almost nil trading activity prior to September 2014, beginning September 2015, the stock has witnessed strong trading volumes. The average trading turnover increased by 55% to Rs95.83 lakh during the period from 1 September 2015 to 15 November 2015, compared to that in the same period in 2014. The average trading turnover then was Rs1.70 lakh. With just about 2,100 shareholders, the number of daily trades averaged as high as 1,300 in October 2015. Is this another pump & dump operation? Will the regulator investigate?

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COMMENTS

Prashant Rishi

1 year ago

How can one see/calculate the following metrics mentioned in the article:
1. Avg daily turnover of a scrip
2. Avg number of daily trades of a scrip